Assignment
Avatar Auto Parts Company uses the indirect method to prepare its statement of cash flows. Refer to the following financial statement information for the year ending December 31, 2015:
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Avatar Company
Comparative Balance Sheet
December 31, 2015 and 2014
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2015
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2014
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Increase / (Decrease)
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Cash
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$33,000
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$13,000
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$20,000
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Accounts Receivable
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29,000
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36,000
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(7,000)
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Inventory
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56,000
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29,000
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27,000
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Plant and Equipment, net
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126,000
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92,000
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34,000
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Total Assets
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$244,000
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$170,000
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$74,000
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Accounts Payable
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$9,000
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$13,000
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$(4,000)
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Accrued Liabilities
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7,000
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3,000
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4,000
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Long-term Notes Payable
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70,000
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79,000
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(9,000)
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Total Liabilities
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$86,000
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$95,000
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$(9,000)
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Common Stock
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$55,000
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$3,000
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$52,000
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Retained Earnings
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115,000
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78,000
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37,000
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Treasury Stock
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(12,000)
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(6,000)
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(6,000)
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Total Stockholders' Equity
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$158,000
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$75,000
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$83,000
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Total Liabilities and Stockholders' Equity
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$244,000
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$170,000
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$74,000
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Avatar Company
Income Statement
Year Ended December 31, 2015
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Sales Revenue
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$291,300
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Interest Revenue
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1,000
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Gain on Sale of Plant Assets
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6,000
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Total Revenues and Gains
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$298,300
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Cost of Goods Sold
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145,000
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Salaries and Wages Expense
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49,000
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Depreciation Expense-Plant Assets
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16,000
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Other Operating Expense
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25,000
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Interest Expense
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3,500
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Income Tax Expense
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7,800
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Total expenses
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246,300
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Net Income
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$52,000
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Additional information provided by the company includes the following:
Equipment costing $60,000 was purchased for cash.
Equipment with a net asset value of $10,000 was sold for $16,000
During 2015, the company repaid $43,000 of Long-Term Notes Payable.
During 2015, the company borrowed $34,000 on a new Note Payable
There were no stock retirements during the year.
There were no sales of Treasury Stock during the year.
Requirement: Prepare a statement of cash flows for year end 2015.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.